Target upgraded, CVS downgraded: Wall Street’s top analyst calls

The most talked about and market moving research calls around Wall Street are now in one place. Here are today’s research calls that investors need to know, as compiled by The Fly. 

Top 5 Upgrades:

• Citi upgraded Target (TGT) to Buy from Neutral with an unchanged price target of $180. The firm believes Target has emerged as “one of the winners within the retail landscape” with an opportunity to improve EBIT margin in the years to come.
• Citi upgraded Gap (GPS) to Buy from Neutral with a price target of $28, up from $21. After a strong Q4 where both Old Navy and Gap showed momentum and margins significantly above expectations, management guided fiscal 2024 earnings “very conservatively,” the firm tells investors in a research note.
• Wolfe Research upgraded Insulet (PODD) to Outperform from Peer Perform with a $200 price target. The firm cites the company’s growing type 1 diabetes share gains, outside the U.S. catalysts, profitability potentially a “coiling spring,” and a “less demanding” share valuation for the upgrade.
• Barclays upgraded Omnicom (OMC) to Overweight from Equal Weight with a price target of $110, up from $100. The firm says Omnicom shares are “too cheap” for the growth offered by the company.
• Compass Point upgraded Sunstone Hotel (SHO) to Neutral from Sell with a price target of $12, up from $10. The firm notes the company’s results came in above its expectations and management raised its 2024 outlook to account for the recent Hyatt Regency San Antonio Riverwalk acquisition.

Top 5 Downgrades:

• TD Cowen downgraded CVS Health (CVS) to Hold from Buy with a price target of $59, down from $99. The firm believes the company’s Q1 “introduced further downside risk and uncertainty.”
• Wells Fargo downgraded Integra LifeSciences (IART) to Equal Weight from Overweight with a price target of $25, down from $45. The firm had previously upgraded Integra as it had believed that the Boston facility restart would represent an inflection point and drive potential EPS upside from a return of high margin products, but management noted that it no longer expects to resume Boston commercial distribution in 2024.
• BofA downgraded Teradata (TTD) to Underperform from Neutral with a price target of $39, down from $48. The company’s execution remains mixed in the near term and the back-half of the year loaded guidance creates incremental risk, the firm says.
• Jefferies downgraded Lyra Therapeutics (LYRA) to Hold from Buy with a price target of 50c, down from $10. The company reported “disappointing” Phase III data, which came as a “great surprise” given the de-risked steroid mechanism of action and sham arm performing in-line with expectations, the firm tells investors in a research note. BofA also double downgraded Lyra Therapeutics to Underperform from Buy, while H.C. Wainwright downgraded Lyra Therapeutics to Neutral from Buy.
• Redburn Atlantic downgraded Vestis (VSTS) to Neutral from Buy with a $13.40 price target. It is taking longer than anticipated to introduce improved momentum in the business with net volume likely to remain negative into early next year, the firm tells investors in a research note.

Top 5 Initiations:

• Mizuho initiated coverage of Corning (GLW) with a Neutral rating and $36 price target. The firm says it could become more constructive on the shares if Asian currencies recovered, and/or price increases to offset currency without share loss were implemented.
• Jefferies initiated coverage of UL Solutions (ULS) with a Buy rating and $42 price target. The firm is bullish on the underlying inspection and certification market, which the firm thinks should grow mid-single digits annually. Baird, Citi, Stifel, Wells Fargo, William Blair, Raymond James, BofA, and JPMorgan also initiated the stock with Buy-equivalent ratings. Not as bullish, UBS and Goldman Sacks started coverage of the name with Neutral-equivalent ratings.
• Citi initiated coverage of Summit Therapeutics (SMMT) with a Buy rating and $7 price target. The firm also opened a “90-day positive catalyst watch” on the shares. Summit’s lead asset ivonescimab is “heavily de-risked” on mechanism-of-action and poised to disrupt the treatment landscape in non-small cell lung cancer, Citi added.
• New Street initiated coverage of Kaspi.kz (KSPI) with a Buy rating and $175 price target. New Street believes the company is dominant in payments and has roots in lending with its growth currently driven by triple digit sales in the leading local e-commerce platform.
• H.C. Wainwright initiated coverage of Metagenomi (MGX) with a Buy rating and $10 price target. The firm says Metagenomi has “many shots on goal” to treat a wide array of diseases with genetic mutations of differing formats, sizes and origins.